What is a Fee-Only Adviser?

A fee-only registered investment advisor does not accept commissions for the investments used in your portfolio. Commissions create an inherent conflict of interest between a client and a financial advisor, broker or insurance agent. Approximately 80-85% of financial advisors are not required to act in your best interest and receive commissions.

Bluemound has chosen to be a fee-only registered investment advisor that acts as a fiduciary in your best interest.  We are compensated with a one-time, first-year, flat fee to cover account set-up and then an ongoing reduced percentage of assets under management.

Fiduciary Vs Suitability

A fiduciary is required to act in your best interest. The vast majority of registered investment advisors are fiduciaries. This is an ethical choice they have made.

Brokers, insurance agents and other financial advisors operate by what is called the Suitability Standard. This standard requires that brokers and other sales people should steer you towards products and services that are arguably suited to you. This standard is enforced by self-regulation.

The Suitability Standard DOES NOT require brokers and insurance agents to act in your best interest. While many do, many do not. Brokers and insurance agents can put their compensation above your financial interests.

Fiduciaries are duty bound to avoid any conflicts of interest. They must put your financial interests ahead of their compsenation and may not trade in front of you (front run). Ultimately, fiduciary fee-only financial planners and registered investment advisors are compensated for the informed, independent and objective financial advice that is provided.

Thoughts About Fiduciary Fee-Only Financial Advisors

Here are several articles to help you make sense of the different levels of ethics in finance. I hope the third party insights will be valuable:

Here’s how to understand your financial adviser’s conflicts of interest - MarketWatch

The 19 Questions To Ask Your Financial Adviser - Wall Street Journal by Jason Zweig

Who Can You Trust With Your Money? - AARP

How Much Does A Financial Advisor Cost? - SmartAsset

While there are varying levels of service, I have built Bluemound to be a low-cost, fee-only, fiduciary advisor, providing essential investment advice for a rapidly changing world.

Contact me to talk to me about a low cost, fee-only, fiduciary, financial advisor relationship.